(MENAFN - Arab News) Bahrain-headquartered Gulf International Bank (GIB) reported consolidated net income, after tax, of 31.8 million for the three months ended on March 31, 2012, 23 percent or 6 million up on the comparable prior year period.
"We are pleased to report continued profitability growth in the first quarter of 2012 despite the initiatives we took in the past couple of years to de-risk the wholesale lending portfolio and improve the funding profile of the bank, while at the same time investing in the future of the bank through new strategic initiatives," GIB Chairman Jammaz Al-Suhaimi said.
Consolidated total assets at the quarter end were 18.5 billion, being 1.7 billion or 10 percent higher than the 2011 year-end level. The asset profile at March 31, 2012 reflected an exceptionally high level of liquidity. Cash and other liquid assets, and short-term placements totaled 8.2 billion, representing a very high 44 per cent of total assets. Investment securities at March 31, which principally comprised highly rated and liquid debt securities issued by major financial institutions and regional government-related entities, amounted to 3.6 billion.
Loans and advances amounted to 6.3 billion, being 0.4 billion lower than at the 2011 year-end level. There was a further improvement in the bank's funding profile in Q1, 2012 with a 1.3 billion increase in customer deposits and a 0.3 billion increase in bank deposits. The exceptionally high level of liquidity was partially being maintained in preparation for the repayment of a 1.2 billion term loan in May. GIB is in an extremely comfortable funding position in advance of the maturity of the term loan facility. GIB's robust funding position reflects the confidence of the bank's customers and counterparties based on its strong ownership and financial strength. In the recent Fitch Ratings report it was stated "GIB has a strong liquidity position...even without relying on its investment portfolio which provides a sizeable liquidity buffer." The Basel 2 total and tier 1 capital adequacy ratios at the end of the quarter were an exceptionally strong 22.9 percent and 18.6 percent respectively.
Net interest income of 31.9 million for Q1 was up 0.6 million on the prior year period. A reduction in the loan volume during the first quarter of the year was offset by an increase in loan margins as the bank reorientates its lending activity from transactional-based long-term project and structured finance to relationship-based large and mid-cap corporates.
Fee and commission income at 15.4 million was 0.8 million or 5 percent higher than in the prior year period.
Other income of 6.4 million was 2.9 million up on the prior year.